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Congress Investigating FCC. FCC Investigating Comcast

bandwidth investigationIt’s an election year, so it comes as no surprise that political issues large and small are getting extra attention.   Tuesday, FCC Chairman Kevin Martin used a CES panel discussion as an opportunity to address the regulatory commission’s stance on the bandwidth throttling complaints that put the nation’s second largest broadband provider, Comcast, into a boiling cauldron of bad PR in October and November.

In no uncertain terms, Martin told the audience, “Sure, we’re going to investigate and make sure that no consumer is going to be blocked.”

At issue is a debate over the policy concept: Network Neutrality. The issues date back to the 1996 Telecommunications Act.  At the time, Internet Service Providers were largely phone companies providing dial up access.  The Act deregulated the telephone industry and forced local telephone companies to share their lines with competitors including cable services.  The Act also dealt with issues for digital TV broadcasting and cable services.   Among its fine print was a distinction that deemed some of the companies under its jurisdiction “Telecommunication Services” and others “Information Services.”  These designations came with different rights.

The rights for Telecom Services were more restricted. They were designated “Common Carriers” by the FCC.  As described previously on Metue, “That designation meant an Internet Access Service like Comcast or Earthlink couldn’t discriminate between data from a competitor or their own site. Accordingly, if it had been available at the time, a video on YouTube or Hulu, or a song downloaded from iTunes, had to be delivered at the same speeds as anything else moved across the ISP’s network. Of course, YouTube, Hulu and iTunes weren’t around in ‘96. Back then, in the world of Web 1.0, content was text and static graphics. In file sizes, things were much smaller.”

The Internet today is a lot different than it was in 1996.  In 2005, regulators, recognizing that, adjusted their stance and decided all high speed internet service providers, whether operating over cable or telephone, would be treated as “Information Services.”  This designation exempted them from the Common Carrier requirements.  It meant, discriminatory practices would not legally be prohibited (even if Policy was otherwise).  It meant, they could in theory (even if practice was otherwise) restrict or prioritize data moved on their networks.  Consumer advocate groups and Internet content companies reacted with immediate demands for legislation to insure “Net Neutrality.”  No legislation came formally, but the FCC issued policy positions that took a stance against data discrimination.

Comcast’s trouble came in October when news began to circulate that they were blocking efforts by some customers to access certain peer to peer file sharing networks.  The accusations charged they were violating the FCC policy and abusing the public trust by secretly interfering with customer’s Internet traffic throughput.  Comcast vehemently denied they were doing this kind of blocking, at first. Then, under pressure, they acknowledged they were in fact delaying, or “throttling,” some traffic.   Their behavior, they claimed, was both reasonable and necessary to balance the load on their servers for the benefit of all their customers.

The FCC does make an exemption from their policy for “reasonable traffic management.”  Comcast argues still that’s what they were doing. Their claim is that file sharing networks, which are often used to move large files,  also require users upload a disproportionately large volume of traffic relative to normal commercial Internet use (outside of sending emails, or uploading the occasional picture/video/file, the majority of consumer internet traffic is downstream).  This disproportionate behavior could dangerously slow their network performance, Comcast said, and that would hurt all their customers.  They had to intervene.

The question now looming as a result is twofold.  1) Is Comcast’s “load balancing” or “throttling” behavior reasonable?  and 2) what obligation do they have to disclose these behaviors to consumers who have otherwise thought they were paying for unlimited Internet access.

Per Chairman Martin’s comments, the FCC is going to look into both. 

There’s not much more new information on the subject beyond that.  That didn’t stop some websites covering Tuesday’s comments from seizing on the added revelation that two of the consumer groups involved in November had suggested the FCC levy a $195,000/per subscriber fine on Comcast for what they’ve been doing.  Added up per subscriber such a charge would exceed a trillion dollars…and that, admittedly, does make for a decent eye-grabbing headline.   Realistically, however, it’s as likely a scenario as George W. Bush finding a way to be re-elected for a third term or Bill Clinton deciding to re-enter the political arena as Hillary’s vice-presidential running mate. 

What is most likely to happen here is exactly what Martin said: there will be some discussion and review, then maybe a few clarifying policy guidelines.  It is, again, an election year, so it’s safe to expect, like wind up teeth that chatter when you coil their spring, some involved will do a round of obligatory grandstanding.   Pundits will go through “point and counterpoint.”  Comcast will stick to their “reasonable necessity” defense.  Maybe, they’ll be assessed a small fine (but if so, it’ll probably be less because of the throttling than how they handled its discovery/disclosure).  After that, they’ll promise to be more forthright in the future, which is something they should have been all along.    (If a corporate practice is, after all, reasonable, there are few reasons to keep it secret). 

Ironically, while the FCC investigates Comcast, the FCC itself will also be under investigation.  FCC Chairman Martin has been challenged for keeping other FCC commissioners in the dark on some matters.  He and the commission have also come under fire for not allowing large enough windows for public commentary on rule proposals.  The House Energy and Commerce Committee is planning oversight hearings for later this year.  They will be looking to see if procedures are “conducted in a fair, open efficient and transparent manner” said a letter issued from Committee Chairman, Representative John Dingell (Dem./Michigan) and ranking Republican Joe Barton (Texas).

According to the Congressmen, the “investigation will also address a growing number of allegations received by the committee relating to management practices that may adversely affect the agency’s operation."

Hmm, now that’s a decent headline:  “Congress investigates Transparency of FCC Behavior. FCC Investigates the Transparency of Comcast’s.”  Yep, it is an election year.


[Editor’s Note: A more thorough look at Net Neutrality, both origins, present situation,  and with consideration of the stakes for the Entertainment Industry can be found in a November Metue article titled “Bandwidth Blockades.”  It and other information can also be seen in the Related Articles section that follows]


Related Articles
Bandwidth Blockades: ISP Throttling and the Entertainment Industry
Request for Senate Hearings on Net Neutrality (PDF)
2006 Debate Between Craig Newmark (of Craigslist) and Mike McCurry (Lobbyist for the phone industry)(via WSJ)

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